DS Smith Beer Value Whitepaper

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Making the right kind of impact

How we are helping Beer & Cider brewers meet the challenges of a changing world

The North American market – one of the largest in the world, has seen dynamic shifts in consumer behavior over recent years. These shifts include a thirst for craft beers, a taste for low and zero alcohol variants, the premiumization of alcohol and the steady growth of online sales.

Recent world events and evolving shopping habits have accelerated change and potentially shifted the way we buy Beer & Cider forever.

From our supermarkets to our corner stores, we want to find our favorite drinks quickly and easily, in one place, so we don’t have to shop around. We’re looking for greater value and convenience, as we switch from smaller shopping trips, back to making fewer, bigger trips. We expect to make more purchases online, delivered quickly and securely to our homes to suit our lifestyle.

And of course, we want all of this from brands that we trust to take better care of our planet.

There’s never been a more important time to think innovatively about your packaging.

The world is changing faster than ever. Meet a packaging partner that will help you keep up
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Recent world events and evolving shopping habits have accelerated change and potentially shifted the way we buy Beer & Cider forever.

What’s happening in the North American Beer & Cider market?

The brewing industry is experiencing a packaging revolution, with innovations and trends influenced by the rise of craft beer, changing drinking habits, and concerns for the environment. The global pandemic accelerated some of these trends.

Brewers are facing new challenges

Increase in competition

Breweries across the U.S. have seen an increase in competition over the last 5 years. Making an impact on-shelf is now more important than ever.

Changing shopping habits

Industry insiders suggest Covid-19 may have accelerated the growth of online alcohol sales by up to 3 years - in just 3 months. You cannot afford to ignore new, emerging ecommerce channels.

Problem pollution & plastic

Consumers are calling for sustainability to be built into every facet of your operations, or you face falling sales and de-listing. It has become critical to remove plastics from your supply chain, reduce CO2 and become more environmentally friendly.

At DS Smith’s PackRight Centers our strategists and designers are hard at work creating customized, sustainable packaging solutions to meet the challenges facing brewers today.

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Challenge: Increased competition 01

Making the right kind of impact on-shelf

major challenges facing Beer & Cider brands in-store

Impact on-shelf has always played a major role in driving sales. Over 70% of purchase decisions are made after your customers enter the store.1 Yet despite this, shoppers only look at a fraction of the products on display.

Attention spans are short – on average less than two seconds – and over a third of customers will buy an alternative brand if they can’t easily see the beer or cider they’re looking for on the shelf.

Our latest consumer insight also shows a ‘new normal’ has arrived, where big shopping trips are replacing more frequent, smaller shopping trips. Over half of U.S. shoppers say that they are visiting supermarkets less – a habit that 1 in 4 shoppers say they expect to continue long-term.

So now, at a time when it’s even more crucial for your product to stand out, there are fewer opportunities to achieve it.

Our customized solutions include:

• Consumer packs that support the look and feel of your brand

• Print quality that matches your production price point & positioning

• Shelf-ready packaging designed with ease of implementation in-store

• Pack designs with great surface areas for high quality print –even on small quantities

• Differentiation in-store, making navigation easier

• Innovative POS

Increased competition
It’s vital you are visible
Opportunities to See (OTS) – ‘The new normal’
in competition over the last 5 years 01 Only 2 seconds to be noticed on-shelf 02 03
Fewer
Rise
How our packaging solutions can help you stand out on-shelf
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Over 70% of purchase decisions are made after your customers enter the store.

2 challenges. 2 ways we help

Differentiate with ‘fridge-friendly‘ can packs

With more of us enjoying our favorite Beer and Cider at home, we’re looking to replicate the experience of drinking in pubs and bars as closely as possible, including chilling our beers and ciders to just the right temperature.

We are currently designing innovative fridge packs that fit neatly on the shelf. These packs automatically present the next can every time one is removed, without having to tear open packaging or remove it from the fridge. We are also using our experience in how packaging behaves in cool climates to maintain the appearance and integrity of your packaging, even when chilled.

To help smaller brewers, we can even bundle the print runs of more than one brewery on a single machine.

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Increased competition 01 6
71% of craft beer drinkers try brands with bold and interesting packaging.2

Shout louder with better display areas

Shopping missions are returning to fewer, bigger shopping trips. Therefore planning ahead and stocking up will take priority over meals and drinks ‘for tonight’.

Available in every shape and size, our point-of-sale displays put our customers’ products center stage and we can supply customized and unusual shapes. For our client AB InBev, we designed castlethemed POS to support a Bud Light promotion in wholesalers that resulted in an 86% uplift in sales. The distinctive displays also drove interaction with store colleagues, with some dressing up in medieval costumes and uploading photos to social media – spreading the promotion far beyond the store.

Did you know...

Research by Nielsen shows that almost half (47%) of millennials do their shopping around the perimeter of the store. So packaging in the Beer & Cider aisle needs to work harder to be noticed.

retailers in the wholesale to engage with large off-shelf activation. Retail Marketing to create a suit the space available. campaign and created a castle engagement from stores with staff the display. The campaign award.
You’re invited to be inspired
For more ways to make your packaging stand out on-shelf, contact us for a consultation. Our PackRight Center teams can explain how our solutions can give you a competitive advantage and help you succeed in a changing world.
Increased competition
Beer drinkers are 12.5% more likely to buy a product because it was on a display near the store entrance.
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Challenge: Changing shopping habits

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Making the right kind of impact in ecommerce

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How our packaging solutions can help you stand out online

major challenges facing Beer & Cider brands online Protecting products in transit (from damage, tampering and theft) 01 Addressing concerns over excess packaging 02 03

Recent world events have dictated that staying home is the new going out. Even as bars and restaurants slowly re-open, all the indicators are that it will be some time before foot traffic and sales return to pre-Covid-19 levels.

This presents serious problems. In order to survive, beer brands must move quickly and begin selling online. They should take advantage of the significant opportunities that exist, from sales to sampling, personalization and subscription models.

Many industry insiders believe Covid-19 has fast-forwarded the impact of ecommerce on sales by three years, in just three months.

We can help brewers get online with our innovations in ecommerce packaging design, robust testing methods and our unrivalled insight into the complexities of supply chains across North America.

• Packaging that survives the rigors of complex commerce supply chains

• Securing products against tampering and theft

• Delighting customers with personalization, limited editions, collectibles and high print quality

• Solutions for mixed cases

• Providing a convenient system for returns

• Direct to Consumer engagement e.g. , QR codes and imbedded LinkReader technology

• Traceability and tracking your products in the delivery network.

You need to get online quickly and safely Wowing your customers in their own homes
Our custom solutions include:
Changing shopping habits

3 challenges. 3 ways we can help

Arrive intact without damage

Our research suggests more than a quarter of shoppers wouldn’t order again from a retailer who sent them a poorly packaged product. 75%3 of those who received a damaged product returned it and requested an exchange. Before working with us, one of our clients operating in the beverage industry found that 1.8 per thousand of their damaged primary packaging was returned without even being opened, regardless of the condition of the product inside.

The ecommerce supply chain is up to 10x more complex than a traditional supply chain. Your beer package can go through as many as 50 different touch points and can incur damage at any point. We can scientifically assess your brewery’s requirements, review the risks your products face in transit and tailor a solution to match. Our methodology is proven to cut your returns by over two thirds.

Safety or Sustainability?

39% of all shoppers who have bought online are concerned by excess packaging.4 So while your customers don’t want to receive broken bottles or crushed cans, they’ve made it equally clear they don’t want wasteful packaging either.

Striking the right balance between protecting your goods and limiting the amount of materials used is a major consideration for anyone selling online. On average in ecommerce, 55% of each box is empty or filled with unnecessary packaging.5 Our customized, sustainable solutions eliminate void fill, improve operational efficiency & lower transportation costs. And applying our revolutionary PACE program standards ensures no more packaging is used than absolutely necessary.

What is PACE ?

Our significant investment in packaging technology, from paper fiber to pack design and manufacture, has enabled us to develop a revolutionary breakthrough that will deliver exceptional, consistent packaging performance, time after time. This innovation, based on rigorous technological advancement and testing, is known as the PACE program.

PACE stands for: Performance, Assurance, Consistency, and Environment promises:

• Clear performance specifications

• Clear conformance criteria

• Reliable consistent packaging

• No unnecessary cost or risk

• No more material than absolutely necessary.

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Finding the balance of both
Your packaging is tested to withstand up to 6 types of damage across 50 supply chain touch points to ensure it will arrive intact.
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Changing shopping habits

You’re invited to be reassured

Much more than beer in a box

Don’t make the mistake of believing the taste of your brew is all your customers are seeking. To reach the new generation of consumers, the way your Beer & Cider arrives packaged needs to stand-out. 58% of online shoppers now buy a product after looking up images and unboxing videos on social media.6 85% of millennials are more likely to make an online purchase if it’s personalized.7 Moreover, if your packaging is Instagrammable, your brand profile will be given an extra boost.

Our 100% customized, sustainable packaging solutions are designed to stand out, protect your product and work seamlessly with your production lines. To add to the experience, we can design a total packaging experience, including innovative LinkReader technology, that your customers will be excited to share.

Although we also offer off-the-shelf packaging solutions, our designers can create 100% sustainable, customized solutions in as little as 2 weeks, to really help your Beer or Cider make an impact when it’s delivered.

Talk to us

Did you know...

55% of online customers said they would purchase Beer & Cider online again if the products came in customized packaging.8

For more ways we can get you online quickly and safely, talk to one of our PackRight Center strategists. They’ll explain how our ecommerce packaging solutions can give you a competitive advantage and help you succeed in a changing world.
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58% of online shoppers now buy a product after looking up images and unboxing videos on social media.
Changing shopping habits
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Challenge: The sustainable advantage

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The sustainable advantage 13

Making the right kind of impact in sustainability

major sustainability challenges facing Beer & Eliminating plastic from the supply chain 01 Reducing CO2 02 03

Cider brands

Your customers are increasingly concerned about the impact of the products they buy on the environment.

Across the world, students are walking out of classrooms on climate strike and the public is frustrated that current commitments to reducing CO2 are failing to deliver real change. Meanwhile, employee activism is forcing companies worldwide to consider their own sustainability and carbon reduction plans.

How our packaging solutions can help to improve sustainability

Of all the plastic waste produced since 1950, only 9% has been recycled9. The world needs an 80% reduction in emissions by 2050 to limit warming to 1.5°C in order to prevent catastrophic climate change.10 The requirement is clear. Removing singleuse plastic from our supply chains and the rapid, widespread decarbonization of our economy is needed.

Our designers have already created a range of sustainable alternatives for the single-use plastic used in the Beer & Cider sector. Even minor changes to existing packaging design can create a domino effect that reduces your carbon footprint by taking hundreds of delivery trucks off the road.

Our custom solutions include:

• Sustainable alternatives to single-use plastic used in Beer & Cider packaging

• 100% recyclable packaging

• Packaging with full chain of custody accreditation

• High quality, environmentally friendly printing inks

• Corrugated board solutions with the highest recycling rate of any packaging material

• Proven ways to reduce delivery journeys, cut carbon and increase supply chain efficiencies

It makes sense to act sustainably Finding production methods that have less impact on the environment
Many global brands, retailers and manufacturers have already committed to using 100% reusable, recyclable or compostable packaging by 2025. In addition, some brewers have already committed to lowering absolute carbon emissions by 50% within their own operations and by 20% across value chain by 2025.11

3 challenges. 3 ways we help

Goodbye plastic

Each year over 20 million tons of plastic packaging is produced in Europe and globally 8 million tons of plastic waste enters the oceans.12 Our research shows the majority of consumers are prepared to pay more for packaging with less plastic – 72% of Polish people, 63% of Germans and 61% in the UK.

Our packaging designers have developed over 650 designs focused specifically on plastic replacement and have identified five areas within supermarkets where 1.5 million tons of plastic could be replaced with fiber alternatives by 2030.13 These include a range of sustainable alternatives for multican carriers, can clips and fully-enclosed, high-sided trays to replace plastic film. In Germany and the UK our teams have been working on box designs which eliminate adhesive plastic tape – innovating with different closure mechanisms. Implementing these designs with one of our customers has already eliminated 18,000km of plastic tape - enough to stretch halfway around the world.

Cutting CO2

Even minor changes in your packaging design can make a huge difference throughout your supply cycle. We work with partners to create tailored, ‘distribution efficient’ packaging that cuts carbon footprints and reduces delivery miles. 122 million tons of CO2 is emitted by shipping empty space each year.15 Just a couple of millimeters reduction in your box size can take hundreds of trucks off the road each year.

And it’s not just your ‘Goods Out’ where reductions in CO2 emissions can be made. Switching from heavy weight solid board packs to suitable corrugated alternatives, like our R-Flute® packaging, can reduce packaging volume and weight, reducing the number of deliveries to your brewery. For one of our large brewery customers in the UK this has led to a 35% decrease in the number of pallets being delivered to their warehouses – which also means potentially 35% less warehousing space to light and climate control too.

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Our research shows the majority of consumers are prepared to pay more for packaging with less plastic.14
The sustainable advantage

Protecting natural resources, from woodland to water

71% of beer drinkers in the UK think it’s important for beer brands to be environmentally friendly16 and 91% of all consumers believe it’s important for packaging to be sustainable.17

A new study has revealed that European adults admit to throwing 41% of their recyclable material into general waste and nearly three-quarters said they were not clear which types of packaging can and can’t be recycled. This confusion over recycling means that across Europe more than 46 million tons of trash unnecessarily goes into landfills or incineration each year and natural resources like our woodlands are being squandered.18

In Europe, our packaging contains an average of 89% recycled content per box and we also have full Chain of Custody accreditation which ensures that any virgin fibers in our products do not originate from deforested areas. Each cubic meter of wood

Did you know…

The corrugated board we use in our packaging is already a fully circular material and on average it is recycled 25 times around the system.

saved prevents a total of 2 tons of C02 from entering the atmosphere.19 But we also believe there is a desperate need for consistent design to help cut through the confusion in the recycling of packaging to protect both resources and value. This is why we have created 5 Principles of Circular Design with the Ellen MacArthur Foundation. Read more about them on the page opposite.

1. We protect brands and products - packaging protects products and all the resources invested in them

2. We use no more material than necessary - optimized use of packaging materials saves resources and reduces waste

3. We keep packaging materials in use - quality, durability and recyclability are key to keeping packaging products and materials in use for as long as possible, eliminating waste

4. We design for supply cycle efficiency - packaging makes supply chains more efficient, from converter to consumer

5. We find a better way - living our values, we challenge ourselves and our customers to develop more circular packaging solutions

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You’re invited to be surprised Sustainability shouldn’t be a cost. Eliminating singleuse plastic and reducing CO2 can attract and retain customers and deliver efficiencies and value savings throughout your supply chain. At our Impact Centers you can discover practical, easy steps you can take to deliver cost-effective sustainability benefits.
The sustainable advantage
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Our 5 Principles of Circular Design

References

Ready

to make the right kind of impact?

Our packaging designers and strategists are working closely with our customers to meet the major challenges facing breweries across the United States today.

We are making Beer & Cider brands stand out at fixture, helping smaller brewers to develop urgently needed ecommerce channels – finding innovative ways to protect products and optimize supply chains. We are designing plastic out of Beer & Cider packaging, reducing the carbon impact of the just-in-time supply chain and reducing the end-of-life impact of packaging.

What’s more, we are doing all of this while protecting the earth’s precious natural resources at the same time.

With many states considering implementing cost incentives for packaging which considers ecodesign and taxes for non-recyclable packaging, there’s never been a better time to talk to us.

When you visit one of our PackRight Centers you can experience collaborative, interactive sessions that will help you create customized packaging solutions that generate the maximum impact for your brand. Our dedicated team of experts, supported by our revolutionary tools and insightled approach, will develop and deliver sustainable solutions focused on increasing your sales, reducing your costs and managing your risks.

Contact us

www.dssmith.com

Information in this White Paper has been retrieved from:

1. sites.insead.edu/facultyresearch/research/doc. cfm?did=2691

2. www.craftbrewingbusiness.com/featured/reminder-70consumers-choose-beer-time-purchase-2017-nielsenupdate/

3. ‘Transforming E-Commerce’ DS Smith

4. ‘Transforming E-Commerce’ DS Smith

5. ‘Transforming E-Commerce’ DS Smith

6. www.antalispackagingsolutions.co.uk/blog/how-towow-your-ecommerce-customers-the-unboxingexperience/

7. appliedpsychologydegree.usc.edu/blog/psychology-ofsuccessfully-marketing-to-millennials/

8. www.packagingoftheworld.com/2017/07/the-power-ofpackaging-you-probably-did.html

9. www.nationalgeographic.com/news/2017/07/plasticproduced-recycling-waste-ocean-trash-debrisenvironment/

10. www.ipcc.ch/sr15/chapter/spm/

11. beerandpub.com/2019/08/21/british-brewers-decreasetheir-co2-emissions-by-42/

12. P lasticsEurope – The Facts 2018

13. packagingeurope.com/an-interview-with-ds-smithsnew-plastics-replacement-lead/

14. www.iucn.org/resources/issues-briefs/marine-plastics

15. packagingnews.co.uk/top-story/ds-smith-e-commercepackaging-size-continues-huge-problem-17-09-2018

16. www.austriajuice.com/news-blog/alcoholic-beveragestrends

17. https://imbibe.com/news/sustainability-in-beer-are-wedoing-enough/

18. www.dssmith.com/packaging/about/media/news-pressreleases/2020/5/ds-smith-launches-circular-designprinciples-to-drive-sustainability-in-packaging

19. www.fsc-uk.org/en-uk/about-fsc/why-choose-fsc/fscfor-your-business/why-use-fsc-certified-wood

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